Business Ethics in the News

APPLE: Using Public Apologies as a Response to Political Pressure

Wednesday, Apr. 3, 2013

Monday, Apple’s CEO Tim Cook issued an apology in response to growing outrage over its warranty policies in China; the warranty for the IPhone (1 year) does not meet the two-year requirement set by Chinese law. The criticism began on March 15 when China’s biggest state-run television network, China Central Television, aired an investigative report on Apple’s mistreatment of Chinese customers. Among analysts there is concern that the report is part of a larger power play against American technology giants by the Chinese government. Assuming the campaign orchestrated against Apple is trumped up, is it acceptable for Apple to act like it has done something wrong and apologize, or even obligatory in order to protect shareholders?

Patrick: Acquiescing to political manipulation is a sure-fire way to ensure this problem continues. The stakes are high for Apple, China is its second largest market, so choosing its battles carefully is critical but does not mean inaction is the appropriate response. Facing a political force, it becomes clear there is a need for Apple to seek out political support, in the form of the US federal government to protect Apple and other American firms from unfair scrutiny abroad.

Kirk: I think we are uncomfortable mixing a political motive with what is typically a moral act—apologizing. Nonetheless, to protect its shareholders, arguably out of ethical responsibility, it must play the political game. The world is a messy place and you are not obliged in every case to challenge power. You have an ethical obligation to pick your battles to reduce the potential damage to your stakeholders. This is not a free pass to collaborate with evildoers, but a plea to give some consideration to the costs of resistance.